“FURY AS OUR CUTBACKS ARE SQUANDERED ON BAILING OUT GREECE IN SECRET DEAL. ANGER is growing over a secretive deal to stitch together another bail-out for Greece which could cost Britain more than half the £22billion saved this year in spending cuts.” The Express, 11 March 2011.

“New bailout for Greece set to cost taxpayers £3.2bn as Osborne admits UK is 'reluctant participant' Britain could face a £3.2billion bill to bail Greece out of its latest financial crisis, experts warned.” The Daily Mail, 11 May 2011. 

The possibility that the Greek economy is on the brink of needing a second European bail-out seems to have got stronger after rumours grew this week that the country's government might be planning to default on its debts, and even that Greece is thinking of withdrawing from the Eurozone as it continues to be paralysed by its sovereign debt crisis. 

While no official announcements have yet been made, the Express and the Daily Mail have been quick to outline their stance towards any potential UK contribution to an Hellenic bail-out. 

However, while both papers have strongly argued that the UK must opt out of any rescue package, the two papers appear to have very different figures on what liabilities the UK could face if it was involved.

Both agreed that Greece is likely to seek a bail-out of up to £53 billion, based on a figure proposed by the Eurosceptic think tank Open Europe. Yet the Daily Mail put Britain's potential liability at £3.2 billion while the Express cited a figure of 'more than half the £22 billion saved this year in spending cuts' – so more than £11 billion. 

So how are these estimates of the UK's likely liabilities reached? The UK has contributed to the bail-out of Portugal and Ireland through the European financial stability mechanism and an IMF fund, as well as making a direct loan to Ireland. 

When Full Fact looked for official Treasury documents on the UK's liabilities, we quickly discovered that it was clearly not actively (or inactively) publicising what level of support they had put up to Ireland and Portugal. We have got in contact with the Treasury, and are still waiting for them to pass on any official figures. 

However, we do know that Britain has committed to providing around 4.5 per cent of the IMF fund of €250 billion and 13.5 per cent of the European financial stabilisation mechanism fund of €60 billion. These funds are each providing around one third of the bail-outs of Portugal and Ireland. 

Form these contributions, it is expected that the UK made a contribution of around £7 billion to Ireland and up to £4.3 billion to Portugal. The UK's contribution to Ireland was higher because the government extended an additional direct loan of around £3.8 billion to the Irish government. 

In terms of a possible Greek bail-out, we simply do not know how much they would ask for, as there have been no official announcements on the issue. However, if we take the £50 billion figure suggested by the Express and the Daily Mail, and use the same calculations for the previous bail-outs, our calculations showed a possible UK contribution of £3 billion, close to the Daily Mail's figure of £3.2 billion (of a total £53 billion loan). 

So where does the higher Express figure come from. Well, a possible clue to this comes later in the article, where they speak about the Irish and Portuguese bailouts. The paper says: “Any British contribution would come on top of £7 billion given to Ireland and £4.3billion expected to be handed out to Portugal.” 

Adding these figures to a potential Greek bail-out of £3 billion gives us £14.3 billion – much closer to that suggested by the Express. 

To flesh out this higher figure, the Daily Express compared the liabilities to over half the money saved in spending cuts this year. In making this analogy, it is important to keep in mind that the money the UK has put forward to bail out Ireland and Portugal is in loan guarantees, and as David Cameron pointed out in Prime Minister's Questions today, it would only be lost if the countries defaulted on these debts.  

Conclusion

In their articles, both the Daily Mail and the Express have inevitably had to speculate on the issue of any Greek bail-out, as we do not yet know what shape it would take if it does indeed happen.

While the £53 billion total bill for bailing out Greece suggested by Open Europe may be a fair estimate, and the expectation that the UK would foot £3.2 billion of this may be based on some fair assumptions, the Express does not make clear that it is including the cost of previous European bail-outs in proposing a cost of more than £11 billion.

Under no calculations that we have seen would any second Greek bail-out cost the UK more than £11 billion. It seems that in this case the Express have conflated the Irish and Portuguese figures within a potential Greek in seeking a more shocking press lead.

Clearly however, we cannot do anything more than speculate on any possible UK liabilities until Greece actually asks for a bail-out, although it looks increasingly likely that we won't be waiting long.